Cut-price AIDS drug for Brazil

Chicago-based Abbott Laboratories says it has struck a deal with the Brazilian government to sell a key AIDS drug at a 30% reduction in cost.

Big pharma has struggled in recent months with the governments of developing nations, who are increasingly bypassing patents if the companies continue to charge prices they cannot afford.

The offer from Abbott Laboratories appears to have staved off a dispute similar to the one between the company and Thailand, which has threatened to make a generic version of the drug Kaletra, effectively sweeping aside intellectual property considerations.

Brazil has now agreed to pay 73 US cents per pill this year, and 63 cents per pill next year, for Kaletra, compared with the US$1.04 it had been paying.

The deal is similar to one Abbott has offered to other middle and low-income countries.

Abbott has come under criticism from international AIDS agencies after it said it would launch no new drugs in Thailand following the country's announcement it would make generic Kaletra.

A spokeswoman said discussions were still continuing with Bangkok on the issue.

Abbott has in recent months reduced the price of Kaletra offered to Thailand from US$2,200 to US$1,000 - the same discount the company has provided since April to other developing countries.

Several AIDS groups have been protesting Abbott's moves in Thailand, suggesting that withholding the latest version of Kaletra - which does not require refrigeration in its hot climate - is putting patients' health at risk.

AIDS groups say the industry is still acting in an arbitrary way, negotiating lower price deals if countries bring enough pressure to bear, by threatening to buy cheap generic drugs from India, for example.

However, the deal with Abbott over its drug Kaletra was hailed by Brazil's health minister as an example to other companies around the world. It will save the country around US$10 million a year.

In May, it broke the patent on another AIDS drug and now imports a cheaper generic version from India.